UK equity markets started Thursday’s trading session on a positive note ahead of key interest rate decisions from both the Bank of England and the European Central Bank.
Last month inflation reached a 10 year high of 5.1%, which is more than double the official target.
However the emergence of the Omicron variant, and recent government guidance to restrict socialising has added a new degree of complexity to the interest rate outlook.
All major US equity markets finished in positive territory. This was in part due to the Federal Reserve announcing that it was accelerating the pace of its tapering of financial support but in what the market perceived as a balanced way that could address inflation without knocking the economy off course.
The FTSE 100 Index was 1.08% firmer at 7247.76 and the FTSE 250 Index was 1.11% higher at 22,681.
MARKET NEWS
Online fashion retailer Boohoo (BOO:AIM) has reduced earnings guidance for 2021-22 citing disruption to international deliveries and pandemic-related cost inflation. Shares slumped 12% lower to 121.2p.
Guidance for adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) margin has been reduced to 6% to 7%. Previously the market had been guided to a figure of 9% to 9.5%. This equates to an adjusted EBITDA figure of between £117 million and £139 million pounds.
Management now anticipate net sales growth to be 12% to 14%, compared to previous expectations of 20% to 25%.
Shares in Domino’s Pizza (DOM) rallied 19% to 413p after announcing it had resolved a long-running dispute with its franchisees. This will enable more store openings and the implementation of new technology.
Management has also indicated that trading in the current year will be in line with expectations. In 2022 it anticipates an acceleration in sales growth. Over the medium term the company believes it will hit the upper end of its £1.6 billion-to-£1.9 billion sales forecast.
Shares in UK investment platform IntegraFin (IHP) fell 9.2% despite the group reporting a rise in annual profit as funds under direction grew underpinned by 'strong' performance in its investment platform Transact.
For the year ended 30 September, net profit rose 12% to £51.1 million year-on-year as funds under direction grew 27% to £52.1 billion. An interim dividend of 7p was declared, taking the total dividend to 10p, up from 8.3p last year.
Fund management group Schroders (SDR) confirmed that it is in advanced talks with Greencoat Capital, a renewables infrastructure manager, about taking a significant stake in the business. Shares edged 1.7% higher to £34.49.
'Schroders continued to evaluate potential acquisition opportunities in line with its strategy to build a comprehensive private assets platform and enhance its leadership position in sustainability,' it added.
Shares in recruitment firm Robert Walters (RWA) moved 1% higher to £72.48 after it lifted its full-year expectations. This followed a strong trading in the fourth quarter.
The group now expects pre-tax profit for the year to the end of December 2021 to be ‘comfortably ahead’ of current market expectations. The company is due to release a fourth-quarter trading update on 11 January 2022.
Shares in unbranded consumer goods maker McBride (MCB) fell 7.1% to 55p as it warned rising costs would result in losses 70% higher than it was guiding for two months ago.
